Ghost brands: public deception or ingenious invention?

10th December 2018

As consumers we’re pretty switched on to false advertising. If something seems too good to be true we know it probably is. And if a product fails to turn up or isn’t as described, we’re not afraid to speak up. However, there’s grey area creeping into our digital shopping platforms: ‘ghost’ brands.

Perfectly legal but morally questionable, it’s not that these companies have died and their brands are living on as zombies, they simply never existed in the first place. Figments of a marketer’s imagination, devised to deceive.

There’s every chance you’ve stumbled upon a few. Deliveroo’s ‘dark kitchens’, catering from car parks as oppose to restaurants they appear to be; supermarket fridges littered with foodstuffs from ‘fake farms’ with British-sounding names such as ‘Boswell Farms’ and ‘Redmere Farms’ when the meat is in fact from Europe; and Amazon’s growing army of private-label brands on its virtual shelves, meant to blend in alongside external counterparts.

Those behind them argue they exist for the benefit of consumers - serving a price point that existing brands neglect. Perhaps. But it doesn’t negate the fact that they are less than transparent about their origins.

In this age of authenticity, the provenance of products can be a powerful pull. Apple plays the ‘Designed in California’ card even though it outsources almost all of its manufacturing to China. All of the great names in British motoring still play on their heritage, despite being increasingly foreign owned. However, these are frame of references that seem to fall within the acceptable limits of make-believe. That changes were food is concerned. We hold brands against higher standards of transparency when it comes to what we eat.

Provenance marks such as ‘Made In’, ‘Made By’ and ‘Made Since’ imply inherent qualities such as freshness, sustainability and a commitment to employee and animal welfare. “Ghost” brands obscure those claims. Would you feel differently about your dinner if you discovered it was flown in from overseas or cooked up in a shipping container? Apparently so…

The National Farmers Union (NFU) referred Tesco to Trading Standards in the case of its fake farms. Their study suggested that of the nearly 1,800 people who believed Tesco’s farm labels are sourced from the UK, 60% say they would feel misled if that were untrue.

Ghost brands also raise questions about the unfair advantage the platforms and retailers have over traditional brands. Their data obsession grants them unrivalled access to competitor brands and consumer shopping habits on their platforms.

Those advantages are compounded when ghost brands rank higher in search results on these platforms, or appear as the default option for voice searches on Alexa. A similar advantage exists when Deliveroo can bypass high street rents by setting up dozens of “dark kitchens” in an industrial estate close to clusters of office buildings.

So, back to our original question: are ghost brands a public deception or ingenious invention?

Ghost brands undoubtedly succeed as a shortcut to greater margins. However, their imaginary origins put short-term profits over long-term trust. This is arguably more dangerous territory for established companies than fail-fast startups, where brand equity is slow to build but easy to lose. It also makes them sitting targets for competitor campaigns, with more and more brands, such M&S and McDonalds, keen to push more transparent traceability standards.

Ultimately, it’s the consumer who will unmask ghost brands. By asking more questions and digging a bit deeper to uncover marketing white-lies, they will give local, independent brands a fighting chance to compete on the big platforms and ensure everybody is playing by the same rules.